EUR/USD seen grinding lower to 1.2200 – UOB

The pair is expected to test the area around 1.2200 the figure in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “While EUR edged below last Friday’s 1.2259 low, it recovered without testing the strong 1.2240 support. The rebound from a low of 1.2256 appears to be running ahead of itself and further sustained up-move is not expected. That said, a retest of the overnight high near 1.2360 is not ruled out but 1.2385 is a major resistance and is unlikely to yield so easily. Support is at 1.2310 followed by 1.2280. Further down, the strong 1.2240 support is not expected to come into the picture for now”.

Next 1-3 weeks: “EUR edged to a low of 1.2256 before staging a surprisingly strong rebound. However, as highlighted yesterday (19 Mar, spot at 1.2285), only a move back above 1.2385 would indicate that the current downward pressure has eased. Until then, we continue to see chance for EUR to move lower and test the strong support at 1.2200. That said, in view of the strong recovery yesterday, EUR could consolidate around current levels for a few days before making the next attempt lower”.